Some councilors wary of proposed tax deal with Worcester company

A proposed tax-relief deal for a business in the Worcester Airport Industrial Park has hit a snag because of concerns about the number of new jobs that would result from it.

The City Council Commerce and Development Committee Tuesday night tabled for one week City Manager Michael V. O'Brien's recommendation to give Tricab Inc. a 10-year tax-increment financing deal that would help the company finance its planned $19.4 million expansion.

While Tricab officials said the expansion would create 15 new jobs, committee members raised questions about whether that number was commensurate with the amount of tax relief the company would receive under the so-called TIF agreement.

Under the proposal, Tricab would receive an average tax exemption of 60 percent on the new property taxes generated by the expansion over 10 years. Over the term of the deal, the company would save an estimated $1.9 million in property taxes.

That savings could then be redirected by the company into financing its expansion.

Councilor-at-Large Frederick C. Rushton, committee chairman, called the proposed TIF “an aggressive plan,” but he had reservations about it because of the number of new jobs that would be created.

“A lot of tax revenue would be forgiven for not a huge amount of jobs in return,” Mr. Rushton said. “At first blush, 15 jobs with a nice TIF attached to it does not make much initial sense. And this isn't just about 15 jobs, either. It's about growing past those 15 jobs and what is this company's growth potential in Worcester.”

Tricab is a maker of cables; it has an 86,856-square-foot industrial building at 15 Coppage Drive, which also serves as company headquarters.

The company wants to expand the operation with a 75,000-square-foot compounding facility adjacent to the existing building. Company officials said the expansion would allow Tricab to manufacture wire and cable coatings and create 15 new jobs — four professional and 11 skilled positions — in addition to retaining the 50 employees who work there.

The estimated project cost is $19.4 million, which includes $10 million for the new building and $9.4 million in new equipment.

Councilor-at-Large Joseph C. O'Brien and District 3 Councilor George J. Russell also expressed concerns about the TIF as it has been proposed. Mr. Russell questioned if Tricab would relocate if the council ended up denying the TIF deal.

“Worcester has a lot to offer; we have a great workforce,” he said. “My concern is about the amount of jobs coming out of this. I don't know if I feel comfortable with it.”

Mr. O'Brien, meanwhile, said the council needs to strike a balance between the need for tax revenue and keeping the city attractive for businesses.

“We need to make sure what's best and makes the most sense for the community,” he said.

Paul Morano Jr., the city's business assistance director, said even with the TIF, the city would receive an estimated total of $2.1 million in tax revenues from the company during the 10 years of the tax deal.

After the TIF runs its course, he said, the city would receive an estimated $460,000 in property taxes annually from Tricab.